CBM producers can now use gas for internal consumption

CBM producers can now use gas for internal consumption
The Cabinet Committee on Economic Affairs (CCEA) today allowed companies producing coal bed methane (CBM) to sell gas to its own affiliates, by giving marketing and pricing freedom for CBM.
This is likely to be a boost for companies like Reliance Industries Ltd (RIL), Great Eastern Energy Corporation Ltd (GEECL), Essar Oil and Oil and Natural Gas Corporation (ONGC), which are the major players in the segment. As per the decision, while discovering the market price for arms length sales, the contractor has to ensure a fully transparent and competitive process for sale of CBM with the objective that the best possible price is realised for the gas without any restrictive commercial practices.
CBM contractors have also been permitted to sell the CBM to its any affiliate, in the event contractor cannot identify any buyer. Royalty and other dues to the government, however, shall be payable on the basis of petroleum planning and analysis cell (PPAC) notified prices or selling prices, whichever is higher.  Read More…
Credit By: business-standard.com

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